City Holds Annual Budget Retreat Feb. 9

February 9, 2005 - The City's financial condition is improving because of tighter control of expenses, increased sales taxes and better collection of delinquent taxes, Mayor Bill Haslam told City Council Wednesday. 

At a retreat outlining financial issues impacting the City's budget for the fiscal year beginning July 1, Mayor Haslam noted that the City continues to face the dilemma that expenses are increasing faster than revenue. 

"While we are doing better as a City managing our finances, the same underlying problem exists - our expenses are growing at a faster rate than revenues," the Mayor said. 

The City's financial position for the current year ending June 30 is expected to be about $1.75 million more than had been projected. That money will be added to the fund balance, which has decreased in recent years to finance ongoing operations. The Haslam administration has assured agencies that rate the City's debt that the fund would be restored in the future. 

Mayor Haslam outlined progress on several capital improvement projects, explaining that his philosophy that the City should invest in things that will either make money or save money for the City. 

The downtown movie cinema remains on track for a spring 2006 opening. Several proposals from private firms to redevelop assets on the World's Fair Park are being reviewed, and the Mayor expects to have a recommendation shortly. A request for proposals for a private firm to enhance the City-owned Poplar Street parking lot will be out soon. And a feasibility study related to development on the South Knoxville waterfront should be completed by the end of March. 

The City is also investing in infrastructure to make City government more efficient and provide better service to citizens. Those include a 311 customer service center and a new financial reporting system that will track purchases, contracts and grants. Both projects will be up and running this summer. 

Challenges remain to reign in increases in health insurance, pensions and worker's compensation. 

While the City budget will end the year above projections this year, forecasts show that a nearly $3 million deficit will occur by fiscal year 2006-2007 and by $7 million in fiscal year 2007-2008 should revenues and expenses continue growing at the same rates. 

"It's our job to change that scenario," Mayor Haslam said. "We must find new ways to increase revenues and decrease expenses. Those will not be easy decisions, but they are necessary for the City to remain a viable entity." 

Mayor Haslam will hold hearings on the budget April 5-7, and deliver the proposed budget for fiscal year 2005-2006 on April 28.


BUDGET INFORMATION

2005-2006 Budget Info
Six Month Financial Report [PDF]
Budget Retreat Presentation [PDF]
Budget Archive (Budgets from years 2001-current year)


BUDGET CALENDAR

February 9, 2005 – City of Knoxville Budget Retreat and Six Month Financial Report released
February - March, 2005 – Departments Submit Budget Requests, Base Numbers Calculated, and Capital Budget Prepared
April 5-7, 2005 – Mayor’s Budget Hearings
April 28, 2005 – Mayor’s Budget Address
May 10, 2005 – First Reading of Budget and Tax Ordinances
May, 2005 – Council Budget Hearings & Public Hearing
May 24, 2005 – Second Reading of Budget and Tax Ordinances